Convincing the board can be difficult enough. Convincing your citizens that their rates need to be increased is an entirely different challenge. Comparing rates with neighboring communities can get you in trouble, so here is some advice on how to propose a rate increase.

1.       Show the effect of rate changes on individual customers’ bills, such as a local industry or other major customer, or on the average household bill. Information should be provided in terms of dollars and percent increases (often the $ increase will seem much less intimidating than the % increase!). 2.       Plan rate hikes in advance and phase them in 3.       Focus on the need for investment in infrastructure and the problems which will be fixed with an increase in revenues – tell people what the rate increase is paying for or tell them what will be cut without the increase 4.       Establish a customer assistance program to help low-income customers pay their bills 5.       Communicate, communicate, communicate! Communicate with the customers, utility staff, and the media. Put together press releases and craft a consistent message for your staff as to why rate increases are needed. If you are concerned about the impact of rate hikes on a major customer, bring them in and explain why rate increases are needed and make an attempt to bring them into the rate-making process. 6.       Establish good working relationship with elected officials – Make sure the decision makers understand the need for rate increases and that they buy-in to the plan. Don’t present your case for the first time at the Board meeting! Get feedback from the officials to gauge their buy-in. 7.       Explain the history – Explain where you are today and how you got there, explain why rate hikes are needed now (rising construction costs, tightening regulations, aging facilities, etc) 8.       Compare water and sewer rates to the cost of other commodities, especially luxury items (gasoline, basic cable, etc) 9.       Listen to residents’ concerns and make genuine attempt to respond to them 10.   50 percent of utilities change their rates every year, and two-thirds of utilities change them within 2 years (see NCLM-EFC NC Rates Survey or GEFA-EFC GA Rates Survey). Let your board know that you are not the only utility changing its rates. Utilities should review their rates every year. Ask a neighboring utility what worked in their community. 11.   Stagger water and sewer rate increases with other types of utility services (e.g. don’t plan to increase water rates when gas, electricity and solid waste collection rates are expected to rise). 12.   Consider political timing of rate increase. If your board is elected, consider the election cycle!